On October 26, 2010, U.S. federal court judge Kimba Wood issued an injunction forcing LimeWire to prevent "the searching, downloading, uploading, file trading and/or file distribution functionality, and/or all functionality" of its software in Arista Records LLC v. Lime Group LLC.[3][4] A trial investigating the damages necessary to compensate the affected record labels was scheduled to begin in January 2011.[5] As a result of the injunction, LimeWire stopped distributing the LimeWire software, and versions 5.5.11 and newer have been disabled using a backdoor installed by the company. However, version 5.5.10 and all prior versions of LimeWire remain fully functional and cannot be disabled unless a user upgrades to one of the newer versions.[6][7] The program has been "resurrected" by the creators of LimeWire Pirate Edition.[8]

LimeWire offers the sharing of its library through the Digital Audio Access Protocol (DAAP). As such when LimeWire is running and configured to allow it, any files shared will be detectable and downloaded on the local network by DAAP-enabled devices (e.g., Zune, iTunes). Beginning with LimeWire 4.13.9, connections can be encrypted with Transport Layer Security (TLS). Following LimeWire 4.13.11, TLS became the default connection option.[9]

Until October 2010, Lime Wire LLC, the New York City based developer of LimeWire, distributed two versions of the program: a basic free version, and an enhanced version, LimeWire PRO, sold for a fee of US$21.95 with 6 months of updates, or $34.95 with 1 year of updates.[10] The company claimed the paid version provides faster downloads and 66% better search results. This is accomplished by facilitating direct connection with up to 10 hosts of an identical searched file at any one time, whereas the free version is limited to a maximum of 8 hosts.[11]

LimeWire was the second file sharing program after Frostwire to support firewall-to-firewall file transfers, a feature introduced in version 4.2, which was released in November 2004. LimeWire also now includes BitTorrent support, but is limited to three torrent uploads and three torrent downloads, which coexist with ordinary downloads. As of LimeWire 5.0, an instant messenger has been added which uses the XMPP Protocol, an open source communication protocol. Users can now chat and share files with individuals or a group of friends in their buddy list.

From version 5.5.1, LimeWire has added a key activation, which requires the user to enter the unique key before activation the "Pro" version of the software. This has stopped people from illegally downloading the "Pro" versions. However, there are still ways to bypass this security feature, which was done when creating the pirate edition. For example, there are currently cracks available on the internet, and people can continue using the LimeWire Pro 5.5.1 Beta, which also includes AVG for LimeWire and is the first version to include AVG. The most recent stable version of LimeWire is 5.5.16.

Versions of LimeWire prior to 5.5.10 can still connect to the Gnutella network and users of these versions are still able to download files, even though a message is displayed concerning the injunction during the startup process of the software. LimeWire versions 5.5.11 and newer feature an auto-update feature that allowed Lime Wire LLC to disable newer versions of the LimeWire software. Older versions of LimeWire prior to version 5.5.11, however, do not include the auto-update feature and are still fully functional. As a result, neither the Recording Industry Association of America (RIAA) nor Lime Wire LLC have the ability to disable older versions of LimeWire, unless the user chooses to upgrade to a newer version of LimeWire.[7]

On November 10, 2010, a secret group of developers called the "Secret Dev Team" sought to keep the application working by releasing the "LimeWire Pirate Edition".[13] The software is based on LimeWire 5.6 Beta, and is aimed to allow Windows versions to still work and remove the threat of spyware or adware. The exclusive features in LimeWire PRO were also unlocked, and all security features installed by Lime Wire LLC were removed.[14][15]

FrostWire was started in September 2004 by members of the LimeWire open source community, after LimeWire's distributor considered adding "blocking" code, in response to RIAA pressure and the threat of legal action, in light of the U.S. Supreme Court's decision in MGM Studios, Inc. v. Grokster, Ltd.. When eventually activated, the code could block its users from sharing licensed files. This code was recently changed when lawsuits had been filed against LimeWire for P2P downloading. It had blocked all their users and redirected them to FrostWire.[citation needed] FrostWire has since completely moved to the BitTorrent protocol from Gnutella (LimeWire's file sharing network).

In November 2010, as a response to the legal challenges regarding LimeWire, an anonymous individual by the handle of Meta Pirate released a modified version of LimeWire Pro, which was entitled LimeWire Pirate Edition.[16][17] It came without the Ask.com toolbar, advertising, spyware, and backdoors, as well as all dependencies on LimeWire LLC servers.[18]

In response to allegations that a current or former member of Lime Wire LLC staff wrote and released the software, the company has stated that: LimeWire is not behind these efforts. LimeWire does not authorize them. LimeWire is complying with the Court’s October 26, 2010 injunction."[16]

The LimeWire team, after being accused by the RIAA of being complicit in the development of LimeWire Pirate Edition,[19] swiftly acted to shut down the LimeWire Pirate Edition website. A court order was issued to close down the website, and, to remain anonymous, Meta Pirate, the developer of LimeWire PE, did not contest the order.[20]

On February 15, 2010, LimeWire reversed its previous anti-bundling stance and announced the inclusion of an Ask.com-powered browser toolbar which must be explicitly opted-out to prevent installation.[21] The toolbar sends web and bittorrent searches to Ask.com, and LimeWire searches to an instance of LimeWire on the user's machine.

In LimeWire versions before 5.0, users could accidentally configure the software to allow access to any file on their computer, including documents with personal information. Recent versions of LimeWire do not allow unintentional sharing of documents or applications. In 2005, the US Federal Trade Commission issued a consumer warning regarding the dangers of using peer-to-peer file sharing networks, stating that using such networks can lead to identity theft and lawsuits.[22] On May 5, 2009, a P2P industry spokesman represented Lime Wire and others at a U.S. House of Representatives legislative hearing on H.R. 1319, "The Informed P2P User Act."[23]

One investigation showed that of 123 randomly selected downloaded files, 37 contained malware – about 30%.[24] In mid-2008, a Macintoshtrojan exploiting a vulnerability involving Apple Remote Desktop was distributed via LimeWire affecting users of Mac OS XTiger and Leopard.[25] The ability to distribute such malware and viruses has also been reduced in versions of LimeWire 5.0 and greater, with the program defaulting to not share or search for executable files.

Prior to April 2004, the free version of LimeWire was distributed with a bundled program called LimeShop (a variant of TopMoxie), which was spyware. Among other things, LimeShop monitored online purchases in order to redirect sales commissions to Lime Wire LLC. Uninstallation of LimeWire would not remove LimeShop. With the removal of all bundled software in LimeWire 3.9.4 (released on April 20, 2004), these objections were addressed.[26] LimeWire currently has a facility that allows its server to contact a running LimeWire client and gather various information.[27]

An identity theft scheme involving LimeWire was discovered in Denver in 2006.[28] On September 7, 2007, Gregory Thomas Kopiloff of Seattle was arrested in what the U.S. Justice Department described as its first case against someone accused of using file sharing computer programs to commit identity theft. According to federal prosecutors, Kopiloff used LimeWire to search other people's computers for inadvertently shared financial information and then used it to obtain credit cards for an online shopping spree.[29]

LimeWire automatically receives a cryptographically signed file, called simpp.xml, containing an IP block list. Blocking certain IPs has become commonplace and even considered essential in P2P filesharing.[citation needed]

According to a June 2005 report in The New York Times, Lime Wire LLC was considering ceasing its distribution of LimeWire because the outcome of MGM v. Grokster "handed a tool to judges that they can declare inducement whenever they want to."[30]

In response to the ruling, a company spokesperson said that the company is not shutting down, but will be using its "best efforts" to cease distributing and supporting P2P software.[36]

In early 2011, the RIAA announced their intention to sue LimeWire, pursuing a statutory damages theory that claimed up to $72 trillion in damages[37] – a sum greater than the current GDP of the entire global economy. There are currently around 11,000 songs on LimeWire that have been tagged as copyright-infringed, and the RIAA estimates that each one has been downloaded thousands of times, the penalties accruing to the above sum.[38][39]

A trial to decide on the eventual amount of damages owed by Limewire to thirteen record labels, including Warner Music Group and Sony Music, all of which are represented by the RIAA, started early in May and went on until on May 13, 2011, when Gorton agreed to pay the 13 record companies $105 million in an out-of-court settlement.

Mitch Bainwol, chairman of the RIAA, referred to the "resolution of the case [as] another milestone in the continuing evolution of online music to a legitimate marketplace that appropriately rewards creators."[40]

^Wood, Kimba. "Opinion and order" (PDF of facsimile). United States District Court, Southern District of New York. p. 6 of the faxed document, 7 of the PDF. Archived from the original on March 31, 2011. Retrieved April 17, 2012. Plaintiffs have never explained to the Court how they would even go about determining how many direct infringers there were per work. However, Plaintiffs have alleged that there were more than 500 million downloads of post-1972 works using the LimeWire system.